AN ANALYSIS OF THE CONSEQUENCES OF CONTRACT ADMINISTRATION PROBLEMS FOR CONTRACT TYPES

Abstract

The primary purpose of this research was to examine the perceived consequences of ten types of contract administration problems for each of seven contract types and to determine how likely each of these consequences were perceived to be. Building upon the earlier research of Davison and Sebastian (in press a, b), the research surveyed National Institute of Government Purchasing (NIGP) and Institute of Supply Management (ISM) members. For each of seven types of contract (e.g., supplies and small purchases) the respondents were asked to indicate the typical consequences they experienced for each of ten contract administration problems (e.g., wrong product). The major problematic consequences examined were contract delays, contract costs, and contract termination. The perceived likelihood of occurrence for each consequence, on the contracting process, was determined for each contract problem within each contract type. The major findings were that when contract administration problems occurred, problematic consequences were more likely than no consequences for all contract types except leases and that the types of problematic consequences that were most likely depended on the type of contract. The implications of the results from this research and Davison and Sebastian’s previous findings for procurement professionals and the purchasing process were discussed along with future research directions.